The consumer price index in the UK declines for the third consecutive month

• Consumer Price Index (CPI) in the UK (y/y) is 2.4%, the forecast is 2.5% .
• Consumer Price Index (CPI) in the UK (m/m) is 0.4%, the forecast is 0.5%.

The consumer price index in the UK in May fell again, thereby causing serious concerns about the targeted increase in inflation. The indicator above 2% remains target and the decline to this mark was expected. But the current dynamics and the very rapid pace of tightening monetary policy in the UK indicate the opposite.

Fig. 1: UK CPI chart

The pair GBP/USD accelerated the decline, and updated the low of the current year at 1.3340, but is in no hurry to exit the descending channel. This is also indicated by the considerable oversold of the pair at the senior timeframes. Therefore, correction within the downward trend with the resistance level test is very likely: 1.3400-10 and 1.3440-50.

Fig. GBP/USD. Current price – 1.3370

Also read: “Index of business activity (PMI) in the manufacturing and service sectors”

Hanzenko Anton